Installment Clearance & Extended Deadlines: Ethiopia’s 2026 Customs Overhaul

Importers facing cash constraints may soon be allowed to clear goods in installments under a proposed amendment to the Customs Proclamation.

The draft law introduces provisions allowing goods declared under a single entry to be released in parts when importers are unable to pay full duties and taxes upfront.

A planned consultation meeting with stakeholders on the draft customs proclamation amendment was postponed after parliament failing to meet quorum, delaying discussions on a reform package that signals one of the most comprehensive overhauls of Ethiopia’s customs system in years.

At the center the draft amendment is a provision that responds directly to liquidity challenges faced by importers.

“…importers often face challenges when they are unable to pay the full customs duties and taxes for all items simultaneously due to financial constraints, preventing them from collecting their goods,” reads the draft.

While the standard requirement remains that goods imported under a single declaration must be released together, the draft proposes to grant the Customs Commission the ability to allow the partial release of goods in cases “where the importer is unable to pay the total required duties and taxes at once due to a shortage of funds.”

The draft law also seeks to address trade disruptions linked to strict country-of-origin rules. Under the current system, goods lacking origin labels are required to be re-exported. The draft proposes to handle these cases through administrative measures, citing “a significant impact on import trade activities and the national economy as a whole.”

On the other hand, since the regulation must clearly identify the body responsible for verifying and enforcing the ‘Rules of Origin’ as specified in the African Continental Free Trade Area (AfCFTA) agreement and other duty-free trade agreements signed by Ethiopia, the amendment has been made to include this provision as well, according to the brief document.

Another major change targets systemic delays in customs processing. The government admits that existing clearance timelines are unrealistic, stating that the current proclamation stipulates that goods arriving by sea or land must complete customs formalities and be removed from the warehouse within 15 days, while goods arriving by air must do so within 10 days.

However, the document states that “since these timeframes do not reflect the current reality, most goods, with the exception of a few, fail to complete formalities and clear out within the specified period due to the time required for the operational process.”

The Commission admits that it has found it necessary to revise these durations.

Accordingly, the article has been amended to allow goods arriving by sea and land to complete customs formalities within 45 days, and goods arriving by air to do so within 30 days.

Beyond trade facilitation, the draft law places strong emphasis on combating contraband, which officials describe as increasingly complex and organized.

“The complexity of contraband trade is increasing, and the number, type, and capacity of vehicles used by smugglers continue to improve in proportion to the profits generated by the sector. The Customs Commission’s current logistical capacity does not match the capabilities of smugglers or the vast geographic areas in which they operate, making it impossible to carry out prevention work effectively,” the document warns.

In response, stricter enforcement measures are being introduced, including allocating the revenue generated from the sale of confiscated contraband goods toward strengthening the capacity of the Commission based on a coming directive set to be drafted by the Ministry of Finance.

In the area of valuation, the amendment aligns Ethiopia’s system with international standards by adopting transaction-based pricing and allowing the customs authority to establish a price database.

“The value used for customs duty assessment shall be the transaction value agreed upon between the buyer and the seller. However, the draft proclamation also specifies that the Customs Commission may organize a price database to be used for risk management and to verify the accuracy of prices. The information in this database will be used to evaluate whether the price submitted by the importer is reasonable,” reads the document.

The document notes that this will help verify declared values and address disputes.

It reads, “The system established in this draft proclamation is not only consistent with international valuation standards but also goes a long way in addressing the significant grievances importers previously raised regarding price determination, thereby greatly assisting in streamlining the flow of goods.”

Fiscal concerns are also addressed through changes in exchange rate application. The draft acknowledges that the current system has led to revenue losses due to currency fluctuations.

Under the new provision, the applicable exchange rate will be determined at the time a declaration is accepted, rather than when it is registered.

The amendment further expands taxpayer rights by easing appeal requirements. Importers will no longer be required to pay the full disputed amount before filing an appeal. Instead, the article has been amended to allow the importer to file an appeal by paying the portion of the customs duties and taxes they admit to owing, while providing a 50 percent security deposit for the portion of the duties and taxes they dispute.

Administrative penalties are also set to increase, with the document noting that existing fines are no longer effective deterrents due to changing economic conditions.

The draft also clarifies institutional mandates, correcting earlier ambiguities that blurred responsibilities between the Ministry of Finance and the Ministry of Revenues.

The postponed draft law consultation is expected to be rescheduled, with the draft set to proceed to further review before submission to Parliament.